Is D-Wave Quantum Stock Still a Buy?

Quantum computing represents one of the most transformative technological frontiers of our time. It promises to solve complex problems that remain intractable for even the most powerful classical computers. As governments and corporations race to develop quantum capabilities, investors have been seeking ways to gain exposure to this emerging field.

Among the limited public companies in this space, D-Wave Quantum (NYSE: QBTS) has emerged as a standout performer. The quantum computing pioneer’s shares have surged an astounding 1,002% over the past six months, as of this writing, making it one of the top-performing stocks across all U.S.-based exchanges.

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QBTS data by YCharts

Let’s examine if this quantum computing pioneer still scans as a top buy after its remarkable six-month rally.

Recent developments fuel investor enthusiasm

D-Wave recently achieved what many consider the holy grail of quantum computing: proving that its machines can solve real-world problems faster than traditional computers. In simple terms, the company’s newest quantum computer was able to tackle a complex materials science calculation much more quickly and using less energy than even the most advanced conventional supercomputers.

This breakthrough was published in Science, one of the world’s most respected research journals. For investors, this represents strong evidence that D-Wave’s technology delivers on its fundamental promise of quantum advantage; although alternative, less favorable interpretations of the company’s recent announcement are being actively debated within the quantum computing community.

Beyond this recent technological milestone, the company’s business momentum appears to be accelerating. While annual revenue remained flat at $8.8 million for 2024, the more forward-looking metric of bookings tells a different story — surging 128% year over year to $23.9 million for the whole of 2024. The company’s 2024 fourth-quarter results were even more striking, with bookings jumping an impressive 502% to $18.3 million, compared to the prior-year period.

This growing gap between current revenue and future bookings signals the potential for substantial revenue growth in the coming quarters as these customer commitments convert to recognized revenue — an encouraging sign for investors looking beyond today’s financial statements to tomorrow’s growth potential.

Financial position strengthened dramatically

Perhaps most importantly, D-Wave has used the recent stock price appreciation to dramatically improve its financial position via stock sales. As a result, the company’s cash balance currently exceeds $300 million, providing approximately 5.4 years of runway at the current adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) loss rate of around $56 million annually.

Looking ahead, management expects first-quarter 2025 revenue to exceed $10 million, which would represent substantial growth compared to the previous quarter and help the quantum computing pioneer move beyond regular stock sales to shore up its balance sheet.

The valuation question

The critical question for potential investors is whether D-Wave stock remains a buy despite its dramatic appreciation and increasingly rich valuation. At current prices, shares trade at 87.2 times projected 2026 sales, reflecting extremely optimistic expectations about the company’s future growth and market penetration.

Those optimistic about the stock can point to several strengths: D-Wave’s proven leadership in its specific approach to quantum computing (called quantum annealing), its rapidly growing customer commitments (bookings), its newly fortified cash reserves, and the enormous potential market.

Fleshing out this last point, D-Wave, along with its quantum computing peers, is staring down an epic commercial opportunity. According to Boston Consulting Group, quantum computing is expected to create between $450 billion to $850 billion in economic value by 2040.

On the cautious side, skeptics will note D-Wave’s tiny current revenue (less than $9 million annually in each of the last two years), its ongoing substantial financial losses, and a stock price that assumes nearly perfect execution for years to come.

The broader quantum computing industry also faces fundamental questions about when these advanced systems will move beyond specialized applications to become truly mainstream commercial tools that generate consistent profits.

Time to buy?

For investors with a high risk tolerance and a long-term perspective, D-Wave presents an intriguing opportunity to participate in quantum computing’s potentially revolutionary growth. However, D-Wave’s current stock price assumes the company will execute its business plan almost perfectly for several years.

As investors weigh this opportunity, they should keep an eye on several near-term developments that could provide further insight into D-Wave’s trajectory. The company will participate in Nvidia‘s major technology conference this week, where quantum computing advancements are expected to be highlighted, and will host its user conference (called Qubits 2025) in late March, where new customer applications may be showcased.

While D-Wave offers one of the most compelling stories in quantum computing today, it remains best suited for investors who are comfortable with both dramatic price swings and the inherent risks of investing in emerging technologies still proving their commercial value.

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